Play Meter

sign a contract with a competing
vendor.
Few operators will tell you of their
failures ; yet that is where lies the
most knowledge to be gained, to
prevent your making the same
mistakes! As a result of my own
experiences , rather than operating
20-30 games in each location , I now
prefer to spread out the risks and
operate 1-4 games (table games) in
leading restaurants . Although the
total number equals the number in a
game center, the operational risk is
much less , vandalism is down to
nothing , no employees are required ,
and I have gained enough free time
to initiate another futuristic project-
elevating the world of amusement
games into walking , talking robots .
Thus, by example , I have shown
why I went the arcade route ; now
you must answer your own question
and make sure it will accomplish
goals that can't otherwise be
accomplished by other means . If you
are new to the industry , I urge you
first to go buy one game and place it
in a street location , or even move it
around to various locations to test the
differences between a bar, hot dog
stand , skating rink , bowl , or
restaurant , for six months to one year
while you are doing your research on
the electronic amusement centers .
I've long advocated that opening a
large game center without previous
experience is like opening a
supermarket without any previous
experience in the grocery industry .
Critics will pOint to Craig Singer,
president , Nickels In' Dimes , Dallas,
Texas , who proved he not only could
open an electronic amusement
center without any previous ex-
perience , but went on to forge the
second largest chain of them catering
to shopping malls . His success has
been rooted in a solid business
background , proper timing , per-
sistence , willingness to work hard ,
and a reputation for outstanding
performance . However , someone
with his equal attributes would have a
harder time duplicating his triumphs
because that particular market has
matured conSiderably and began to
rely · heavily on established , proven
coin-operators who have specialized
in that market.
In continuing this introductory
overview , economics today make
operating a game center even
more difficult than previously. Prices
of machines have been steadily rising
(despite the fact the electronic games
cost manufacturers less to build) ; the
minimum wages are now guaranteed
to increase ; and the same is true of
rents , gasoline , and your own living
costs .
The factor most new people to the
PLAY METER , November , 1978
industry don 't calculate is the fad
factor . Many distributors won't tell a
potential game center owner "Our
machines may last mechanically for
five or even six years , with good
treatment , but they may quit earning
after six months in that game center
location you 're considering ."
If you 're thinking about quiting a
good job to open a game center
because you 've seen for yourself how
an operator collected $500 , or a
$1 ,000 week or more , keep your
steady job while getting started in the
coin-op business , because you'll
learn why your $200 a week equals
at least $400 a week .
In fact , an operator with one game
center grossing $1 ,000 a week may
not be living on much more than
$200 a week , due to payments on all
those attractive new machines. Your
job's regular pay check may also help
tide you over when the fad factor
begins to take hold .
What is the fad factor?
If more than 40 percent of your
customers are under 21 years of age,
after you 're open about three
months , you 'll start hearing questions
like "When are you going to get
some new machines?" The first time
a kid asks you that , you break out in
a cold sweat, as you think "Jeez , I've
got $60 ,000 in vested in new
machines now (or I'm committed to
$50 ,000 more in payments for these
machines in the next 21 months) .
"What 's wrong with the machines
I've got?" you ask.
"Oh , nothing ," the kid answers ,
"we're just tired of playing the same
'old' machines every day ."
The Fad Factor has sucked many
neighborhood arcades down the
drain faster than Drano . People with
great intentions about proViding an
ideal social outlet for young people in
the area have lost their life savings in
less than one year .
At that end of the experience , they
also learn about the depreciation
factor. Unlike real estate , which
seldom , if ever , goes down in value ,
each game parcel has depreciated as
much as 50 percent in the first year.
The majority of games will depreciate
as much as 90 percent in the first two
years.
The wisest answer , in my opinion ,
is to find a location which has a lot of
transient traffic-customers who
don 't live in the area . This narrows
your choices down to large shopping
malls that attract shoppers from a
large geographic area , or tourist
attractions . Again , the latter offers
the most opportunity for now to
newcomers . In the next issue of
PLAY METER , we will cover the
factors which will influence your
choosing an arcade location .
"Hey!
How
about
tokens
from
Osborne?"
The oldest private
min tin the U. S.
Write for
details and samples
Osborne Coinage Co.
2851 Massachusetts Ave.
Cincinnati , Ohio
45225
U.S. Marshall
COMPLETELY
MECHANICAL
NEVER LEAVES
LOCATION!
THE GREATEST
5 CENT GAME
EVER MADE
J.F. Frantz Mfg.
1936 W. Lake St., Ch icago, IL 60612
312 /829-2399
Welcome AMOA!
Visit Us In Booths
191 Br 192 Br 193
- --
129